Sony Ericsson shows record Q2 growth

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SonyEricsson has shown record growth, having today released its earnings for the second quarter of this year.

Sales were up 25 percent from the previous quarter, from €1,405 million to €1,757 million. This was also a four percent increase in sales compared to the same time last year, when earnings of €1,684 million were posted.

Despite this, the actual number of units shipped has dropped since last year, due to a reduced product portfolio. 11 million units shipped, down 20 percent from 13.8 million units in the second quarter of 2009. There was slight growth compared to the first quarter of this year, however, up five percent from 10.5 million units.

Given the reduced shipments much of Sony Ericsson's earnings came from higher priced handsets. The average selling price increased 19 percent compared to the previous quarter, up from €134 to €160. This was also a 31 percent increase on the same time last year, where the average selling price was only €122.

Sony Ericsson has been tightening its belt during the recession, with its “transformation programme”, which began in 2008, entering its final stages now. It plans to cut expenses by €880 million by the year's end and has cut 4,000 jobs since the programme began. The restructuring has cost the company €374 million since it began.

The cuts have paid off, as Sony Ericsson now has a net cash position of €609 million, up €46 million from the previous quarter. Market share was level at around four percent.

“Our second quarter results show that the company continued the momentum seen in the first quarter as a result of our focus on the value market and the success of new smartphones; Xperia X10 and Vivaz, launched during the first quarter,” said Bert Nordberg, President of Sony Ericsson. “These models, along with the Xperia X10 mini and Xperia X10 mini pro which started shipping at the end of the second quarter, have been well received by operators and we are now well positioned for long term growth.”